UK markets were trading in the red on Thursday morning with BAE Systems and Rexam leading the decline after their annual results disappointed, while mining stocks were being weighed down by yet more disappointing data from top metals consumer China.

The FTSE 100 was registering a 0.3% fall to 6,778 by midday, but had pared losses after hitting an intraday low of 6,732.03 early on.

Investors gave a negative reaction to data from China this morning which showed that activity in the manufacturing sector weakened to a seven-month low. The HSBC/Markit 'flash' China manufacturing purchasing managers' index (PMI) for February fell further into contraction, slipping to 48.3 from 49.5; analysts had expected no change.

"While it is largely excepted that Chinese growth will slow, economic reform and mixed data signals is making any forecasting hopelessly opaque and given the miners dependency on Chinese consumption that is making them less attractive to long-term investment," said Toby Morris, Senior Sales Trader at CMC Markets.

The Eurozone composite PMI also failed to impress, falling to 52.7 from 52.9 in February, surprising analysts who had expected a small increase to 53.1. Activity in the region's second-largest economy, France, contracted further during the month, offsetting growth from Germany.

Japan was also making headlines after recording its biggest trade deficit in history in January of 2.79tn yen. Meanwhile, investors were keeping an eye on ongoing political instability and protests in Thailand, Venezuela and in particular Ukraine.

Over in the States, stock futures were pointing to a weak start on Wall Street as markets continue to digest last night's minutes from the latest Federal Reserve policy meeting. At the January 28-29th meeting, the central bank re-affirmed its commitment to continue tapering stimulus in "measured steps". In fact, some policymakers even suggested raising interest rates "relatively soon".

BAE, Rexam, mining stocks fall

Military hardware manufacturer BAE Systems slumped after reporting a 3% increase in operating profits to £1.9bn for 2013, but warned that profits could fall by up to 10% on the back of pressures on US government spending.

Packaging group Rexam also dropped after missing analysts' estimates slightly with its 2013 results. The company underwhelmed after saying it expects to make "further progress" in 2014, but only on a constant currency basis.

Stock News is provided by Digital Look Corporate Solutions from Sharecast news.
Please read the terms and conditions of useage of this data. Republication or redistribution of content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Digital Look Ltd.

Get a free widget for your website with our latest headlines.

You can now add our live prices and new headlines to your website.The news widget features quotes for Oil prices, spot Gold price and Indices plus a choice of news channel for healines.